The Compound and Friends

Vanguard’s Joe Davis on AI vs Debt, NVDA $4 Trillion, the US Dollar Plunges, Next Hot IPOs

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Jul 1, 2025
Joe Davis, Vanguard's Global Chief Economist, shares insights on the intersection of AI and rising debt, highlighting their potential impact on productivity and economic challenges. He discusses NVIDIA's impressive market valuation and forecasts for tech IPOs, while emphasizing the importance of risk management in uncertain times. Aaron Dillon, an IPO expert, joins to explore recent successes in the tech IPO market, including strategic moves from firms like CoreWeave and innovative trends such as tokenized shares, all set against the backdrop of a weakening U.S. dollar.
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INSIGHT

AI vs Debt: The Decade's Defining Conflict

  • Vanguard's chief economist Joe Davis identifies AI and debt as the key opposing forces shaping the next 5-10 years.
  • One path leads to an AI-driven productivity boom; the other to economic drag from fiscal deficits.
INSIGHT

AI as Next Growth Engine

  • Technology, especially AI, has not driven significant economic growth since the internet age began.
  • AI is expected to be the next significant general purpose technology, potentially surpassing the impact of computers and internet.
ADVICE

Hedge Against Economic Uncertainty

  • Investors should diversify portfolios with strategies that perform well whether AI-driven growth or debt-induced slowdowns dominate.
  • This reduces risk by not betting exclusively on either optimistic or pessimistic outcomes.
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